How Hasbro Wants to Take the Financial Reins of its Movies Starting with ‘My Little Pony’

After spending the past seven years launching film franchises based on its toys and games like Transformers and G.I. Joe, and setting up other movies like “Monopoly,” “Candy Land” and “Risk,” Hasbro Studios is poised to take the next logical step: financing its own features.

The toymaker has launched Allspark Pictures — a clever nod to “Transformers” — through which it will fully fund and co-finance a slate of films. The projects that will inaugurate the banner are an animated “My Little Pony” movie, the first planned to play theatrically in 2017, and a live-action adaptation of animated series “Jem and the Holograms,” which will sing into theaters on Oct. 23, 2015. Universal will split “Jem’s” budget with Hasbro.

“We have a long history in film, and it’s become a very important part of our content strategy,” says Stephen Davis, president of Burbank-based Hasbro Studios. “We want to use great stories to activate our brands,” he adds, to keep them fresh in the minds of the company’s target consumers: kids and families.

Putting its own money on the line for some Allspark projects will give Hasbro more creative control and ownership of its films.

While the company is said to be considering bankrolling movies in the $5 million to $30 million budget range, according to individuals who have discussed partnerships, it’s not turning its back on big-budget franchises, despite the fact its costly 2012 “Battleship” for Universal lost more than $100 million.

“We will continue to make big tentpole movies with our studio partners,” says Davis, explaining that on smaller pictures, Hasbro can have more control over budget and marketing. “There are new economic models that fit certain films,” he notes. “It creates a level of flexibility for us that we can use to our advantage. Where we fully finance a movie, the economics are more potentially favorable.”

My Little Pony” will be one of those, and it’s expected to be budgeted at far less than films like “Despicable Me,” which cost $69 million to produce. Hasbro already has produced direct-to-homevideo animated “Pony” movies, and it’s producing the 100th episode of a TV series that plays worldwide.

“We have a lot of experience working on this particular brand,” says Davis, adding that technology has brought down costs on animation. Joe Ballarini, who is adapting Fox Animation’s “Cardboard,” based on the graphic novel by “Earthworm Jim” creator Doug TenNapel, is penning the script for the “Pony” pic.

With “Transformers,” Hasbro’s content strategy plays out year-round with movies and TV shows. The same is true with “My Little Pony.”

“We’re very excited about the potential of that movie,” Davis says of “Pony,” which doesn’t yet have a distributor. “There’s a tremendous amount of demand for the brand,” with the TV show playing in 180 territories, and toys, licensing and gaming also popular.

Universal, which is releasing “Jem” (in 2015) and “Ouiji” (on Oct. 24), partnered with indie horror producer Jason Blum on both movies.
Ouija” was originally developed by Hasbro and Michael Bay’s Platinum Dunes as a $100 million adventure, but pared back to a $5 million PG-13 thriller for teens and tweens as a way to broaden its brand’s image.

“It was a brand that lent itself to a great story and trends right to teens and tweens and young adults that respond to scary stories,” Davis says of the PG-13-rated film. “The time was right to tell the story.”

By working with Blum, whose Blumhouse label is behind horror hits “Paranormal Activity,” “The Purge” and “Insidious,” Hasbro was able to find a partner that could cut costs and figure out a way to reap more financial rewards from its toy based productions. Hasbro typically sees a bump in merchandise sales when a film is released, followed by its homevideo push and TV spinoffs — by taking more of a financial role in how its movies get funded in the future, it can collect a larger share of the box office, as well.

While developing its new slate of films, Hasbro does keep one disappointment in mind: “Battleship,” whose $200 million budget was covered by Universal.

“We’re very proud of that movie,” which went on to earn over $300 million at the worldwide box office, Davis stresses, but admits “one of the lessons learned was that it was released during a window when there was a very big tentpole movie in competition that really dominated the box office,” referring to Marvel’s “The Avengers.” “Clearly our ability to have better control of the calendarization is important.”

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